VIETNAM COMPANY FORMATION

We have a team of lawyers who have not only good legal backgrounds and skills but having also business mind and strong ties to the field, evidencing by a large number of clients having their foreign direct investment in Vietnam.

Vietnam company formation: We have a team of lawyers who have not only good legal backgrounds and skills but having also business mind and strong ties to the field, evidencing by a large number of clients having their foreign direct investment in Vietnam.

It is worthy of note that for any new establishment of LLC or JSC, it is required to attached the establishment to aninvestment project. In this case, an investment registration certificate shall be issued to the newly established LLC or JSC, which serve at the same time as the business registration certificate of the LLC or JSC.

BCC

BCC is a partnership signed by two or more parties with the objective of conducting jointly one or more business operations in Vietnam on the basis of mutual allocation or responsibilities and sharing of profits or losses, without creating or forming a legal entity in Vietnam.

As BCC is not a separate legal entity, the contractual rights and obligations of the parties must be shared. To co-ordinate the daily operation of a BCC, a co-ordination board can be set up when necessary, with presence of the equal nominees from the parties.

LLC

LLC is established by a single investor or pursuant to a joint venture contract signed by one or more investors, either Vietnamese investors and one or more foreign investors; or between foreign investors, individually or institutionally, for the purpose of carrying out business activities in Vietnam. The difference of the LLC compared with the JSC is that the LLC is not permitted to issue shares, and the number of investors, regardless individual or institutional, is not allowed to be excessive of 50.

JSC

JSC is a company established by at least 3 investors, regardless individual or institutional, local or foreign. Differing from the LLC, JSC can issue shares to the publics. JSC is a kind of limited liability company, and has the legal person status in accordance with the laws of Vietnam.

BOT, BTO and BT

Compared to the said vehicles, regulations covering BOT, BTO and BT are quite few, causing difficulties for implementing.

A written contract which must be signed by foreign investor(s) and an authorized agency, constitutes the principal legal basis for implementing a BOT, BTO or BT project. It differs from BOT to BTO in the right to commercial exploitation of the completed project for getting back investments. This right is realized for a fixed time before transferring to the State of Vietnam in the case of BOT, but in the case of BTO, it follows after transferring. As for BT, foreign investor(s) must hand over the project to the State of Vietnam upon its completion, and instead of commercial exploitation like the case of BOT and BTO, foreign investor(s) is/are provided with opportunities to carry out other projects to get back investments.

In all and every case, a LLC or JSC can be established by foreign investor(s) to carry out the project, in accordance with applicable procedures as described hereof.

Project Classification and Licensing Agencies

Unlike the FIL, the projects under the CLI are classified into two groups, requesting the registration procedures and appraisal procedures. More decentralized, all projects (except BOT, BTO and BT projects to which MPI will issue the Investment certificates) are approved and licensed by city/province-level people's committees with respect to projects outside EPZs and IZs, and city/province-level administration boards of EPZs and IZs with respect to projects inside EPZs and IZs.

Application Document Requirement

An application/ registration file for submission to investment registration agencies, under the CLI, normally includes:

- Application for investment certificate;

- BCC or JV contract, as the case may be

- Charter of LLC or JSC, as the case may be

- Technical-economic explanation or feasibility study for a BCC, LLC or JSC;

Vietnamese language is lawfully required, but a widely-used foreign language may also be accompanied, for instance, English. In principle, the two languages have equal legal weight in determining the parties' intentions, but in case of discrepancies, the Vietnamese shall prevail.

Licensing Procedures and Timing

All the new establishment of LLCs, JSCs, BCCs, BOTs, BTOs and BTs are required to get investment certificate.

With respect to projects subject to the investment appraisal procedures, the time limit for issuance of an investment registration certificate shall be normally within 30 days from its receipt of the satisfactory files, and in special cases the time can be extended but not exceeding 45 days.

With respect to projects subject to the investment registration procedures, the investment certificates shall be issued within 30 days from the receipt of the satisfactory file.

We offer a portfolio of Vietnam business services and Vietnam market entry solutions covering every aspect of these processes. Our expertise encompasses a wide-portfolio of services and advice relating to Vietnam market entry, typically leading to the establishment of:

•A Representative Office in Vietnam
•A Vietnamese investment company with total or part foreign ownership
•A Joint Venture in Vietnam
•A Special Purchase Vehicle using a Hong Kong or a low or zero tax company (“offshore”)
Additionally, HGLAW Worldwide offers:

•Bespoke Vietnam Business Services relating to the identification of suitable tax advisers, lawyers, local partners, premises, factories, management, staff and expatriate housing.
•Professional corporate administration services. We have the capacity to deliver a turn-key back office function for an operation in Vietnam.
Whilst our Vietnam Business Services and Vietnam market entry solutions are broad, many of our clients utilise our services selectively, and this approach is welcomed.

Our clients are diverse. They include major US corporations, international companies and both owner managed business and entrepreneurs.

So, if you are an executive tasked with investigating your company's Vietnam market entry, you should contact us by clicking on the button below:

Vietnam company formation is difficult for foreign investors because of complex licensing procedures. That said, economic reforms are attracting foreign, export-orientated manufacturing industries. Healy Consultants offers a complete Vietnam company formation service. The following information will help you determine whether Vietnam company formation is the optimum corporate structure to fulfill your international business objectives:
Advantages of Vietnam Company Formation
1. Vietnam company formation assists our clients to legitimately conduct business in Vietnam with 100% foreign ownership in selected sectors. For more information, visit our Vietnam 100% foreign-owned company page.
2. A Vietnam Joint Venture is an ideal way for foreign investors to gain ready access to local markets. For more information, visit our Vietnam Joint Venture page.
3. A representative office is a cost-effective way for global companies to create a market presence in Vietnam. For more information, visit our Vietnam Representative Office page.
4. Vietnam company formation requires a minimum of one director, who need not be resident in Vietnam.
5. There are no minimum capital requirements with Vietnam Company formation except for a few specific business lines such as real estate, insurance, aviation services, banking and securities.
6. Vietnam joined the World Trade Organisation (WTO) in January 2007, obliging it to reform its legal system, strengthen intellectual property rights protection and lift trade barriers.
7. Following Vietnam company formation, Healy Consultants can open a corporate bank account with one of the world's leading retail banks, including HSBC, Standard Chartered and Citibank.
8. Healy Consultants can obtain residence visas for foreign employees following Vietnam company formation.
Disadvantages of Vietnam Company Formation
1. A Vietnamese company must pay a corporation tax of 25% on all taxable income. The corporation tax applicable to business establishments conducting exploration and exploitation of oil and gas and other valuable and rare natural resources is between 32% and 50%. Preferential corporation tax of 20% and 10%, in the form of incentives, apply if the enterprise meets specific criteria.
2. Examples of the challenges of Vietnam company formation include i) to obtain a Vietnam branch office license, the foreign company must have been in operation for three years ii) all foreign documents must be translated into Vietnamese and notarised by a Vietnamese state notary or Vietnamese embassy or consulate. For more information, visit our Branch Office page.
3. A minimum of two shareholders is required with Vietnam company formation.
4. Vietnam is negatively ranked as the world's 136th freest economy in the Heritage Organisation’s 2012 Index of Economic Freedom, a measure of freedom enjoyed in business, trade, monetary, financial, investment and labour markets.
5. Vietnam company formation is complex, and this is reflected in Vietnam's low ranking of 98th in the World Bank's Doing Business 2012 Survey. The survey measures factors including business start up procedures, time, cost and minimum capital required to start a business.
6. Vietnam is negatively ranked 65th in the Global Competitiveness Report 2011-2012, by the World Economic Forum, one of the world’s most comprehensive and respected assessment of countries’ competitiveness, offering invaluable insights into the policies, institutions, and factors driving productivity.
7. Vietnam suffers from a poor international business reputation. For example, Vietnam is negatively perceived as the world's 112th least corrupt country in the 2011 Corruption Perceptions Index by Transparency International, a global measure of corruption amongst public officials and politicians.

Vietnam company formation is difficult for foreign investors because of complex licensing procedures. That said, economic reforms are attracting foreign, export-orientated manufacturing industries. Healy Consultants offers a complete Vietnam company formation service. The following information will help you determine whether Vietnam company formation is the optimum corporate structure to fulfill your international business objectives:
Advantages of Vietnam Company Formation
1. Vietnam company formation assists our clients to legitimately conduct business in Vietnam with 100% foreign ownership in selected sectors. For more information, visit our Vietnam 100% foreign-owned company page.
2. A Vietnam Joint Venture is an ideal way for foreign investors to gain ready access to local markets. For more information, visit our Vietnam Joint Venture page.
3. A representative office is a cost-effective way for global companies to create a market presence in Vietnam. For more information, visit our Vietnam Representative Office page.
4. Vietnam company formation requires a minimum of one director, who need not be resident in Vietnam.
5. There are no minimum capital requirements with Vietnam Company formation except for a few specific business lines such as real estate, insurance, aviation services, banking and securities.
6. Vietnam joined the World Trade Organisation (WTO) in January 2007, obliging it to reform its legal system, strengthen intellectual property rights protection and lift trade barriers.
7. Following Vietnam company formation, Healy Consultants can open a corporate bank account with one of the world's leading retail banks, including HSBC, Standard Chartered and Citibank.
8. Healy Consultants can obtain residence visas for foreign employees following Vietnam company formation.
Disadvantages of Vietnam Company Formation
1. A Vietnamese company must pay a corporation tax of 25% on all taxable income. The corporation tax applicable to business establishments conducting exploration and exploitation of oil and gas and other valuable and rare natural resources is between 32% and 50%. Preferential corporation tax of 20% and 10%, in the form of incentives, apply if the enterprise meets specific criteria.
2. Examples of the challenges of Vietnam company formation include i) to obtain a Vietnam branch office license, the foreign company must have been in operation for three years ii) all foreign documents must be translated into Vietnamese and notarised by a Vietnamese state notary or Vietnamese embassy or consulate. For more information, visit our Branch Office page.
3. A minimum of two shareholders is required with Vietnam company formation.
4. Vietnam is negatively ranked as the world's 139th freest economy in the Heritage Organisation’s 2011 Index of Economic Freedom, a measure of freedom enjoyed in business, trade, monetary, financial, investment and labour markets.
5. Vietnam company formation is complex, and this is reflected in Vietnam's low ranking of 78th in the World Bank's Doing Business 2011 Survey. The survey measures factors including business start up procedures, time, cost and minimum capital required to start a business.
6. Vietnam is negatively ranked 65th in the Global Competitiveness Report 2011-2012, by the World Economic Forum, one of the world’s most comprehensive and respected assessment of countries’ competitiveness, offering invaluable insights into the policies, institutions, and factors driving productivity.
7. Vietnam suffers from a poor international business reputation. For example, Vietnam is negatively perceived as the world's 112th least corrupt country in the 2011 Corruption Perceptions Index by Transparency International, a global measure of corruption amongst public officials and politicians.

Vietnam Company Formation
With HDP’s comprehensive legal understanding of the international business environment in Vietnam, we can supply clients with fundamentally beneficial legal advice in areas of foreign investments. Whether it is:
Setting up a 100% foreign invested or joint venture enterprise, joint stock company
Registration and de-registration of branches, businesses and representative offices
Finding partnerships, settling negotiations
Review and drafting of legal documents...
Please find hereunder some key terms and conditions for our Company Incorporation Services:

A. Pre-licensing services:

(i). Consulting:

Attending various meetings with client to explain and confirm the main principles for setting up the Company;
Preparing a list of legal documents required for the appraisal of the Company. Based on the information provided by client, we will review and incorporate these documents into the application file;

(ii). Drafting documents:

Drafting the application form for the Investment Certificate;
Drafting the Charter of the Company;
Drafting an outline of the Feasibility Study for the establishment of the Company based on the client's business intention which shall include descriptions of the activities and operational scope of the Company, the invested capital, the scale of services, and the efficiency of the Company.

B. Incorporating:

Reviewing and assembling all required documents to be included in the application file for the Investment Certificate;
Representing client to submit the application files for the Investment Certificate; and
Acting as client's attorney to follow up with the competent authorities regarding the establishment of the company and obtaining the Investment Certificate.

C. Post-licensing services:
Upon the issuance of Investment Certificate of the Company, we shall assist the newly established Company in complying with post licensing requirements:

Registering and obtaining the Company’s seal;
Preparing necessary dossiers and representing the Company to submit the application for the Company’s Tax Code and Customs Code with the competent tax authorities.

D. Additional services:
Together with the legal services as aforementioned, we would be happy to assist client various legal issues related to business, including:

Advisory services on opening bank account;
Personal income tax registration, declaration and finalization for expatriate and local employees;
Advisory services on employee recruiting and labor issues; Drafting and registering statutory labor collective agreement and internal labor regulations.
Given our experience in working with various international and local companies, we believe that our assistance to client's business in Vietnam would be of great assistance to the establishment of the Company.